![An exterior view of Hyundai Card's headquarters. [Hyundai Card]](https://wimg.heraldcorp.com/news/cms/2026/07/24/news-p.v1.20250707.4388b3e2d8e14a09b0b24afd720d80f1_P1.png)
Hyundai Card posted net profit growth of more than 15 percent in the second quarter, driven by gains in its core card and interest income businesses.
According to earnings data Hyundai Card disclosed Friday, the company's second-quarter net profit reached 120.5 billion won ($81.4 million), up 16.4 billion won, or 15.8 percent, from 104.1 billion won in the same period last year. Operating profit rose 26.9 billion won, or 20 percent, to 161.6 billion won.
Operating revenue was essentially flat, edging down 4.5 billion won, or 0.4 percent, year on year to 1.16 trillion won. Profit improved despite stagnant revenue because operating expenses fell 31.4 billion won, or 3.1 percent, to 994 billion won from 1.03 trillion won.
Core business indicators were solid. Card revenue rose 36.8 billion won, or 8.3 percent, to 477.9 billion won from 441.1 billion won — the largest gain among all revenue categories. Interest income also increased 18.2 billion won, or 4.4 percent, to 434 billion won from 415.8 billion won.
The revenue decline was concentrated in the "other" segment. Other operating revenue fell 59.6 billion won, or 19.7 percent, to 243.7 billion won from 303.3 billion won. Over the same period, other operating expenses dropped even more sharply — down 91.7 billion won, or 39.6 percent, to 140.1 billion won from 231.8 billion won. The net contribution from the other segment improved 32.1 billion won to 103.6 billion won from 71.5 billion won.
That improvement exceeded the 26.9 billion won increase in second-quarter operating profit. Core business margin — card and interest revenue gains of 55 billion won minus the 60.5 billion won rise in card costs, interest expenses, credit loss provisions and selling and administrative expenses — actually retreated 5.5 billion won.
Credit loss provisions were the main drag on core margins. Second-quarter credit loss provisions jumped 31.9 billion won, or 23.6 percent, to 167.1 billion won from 135.2 billion won. The first-quarter increase had been just 1.7 percent, suggesting asset quality pressures intensified noticeably in the second quarter.
Funding costs also reversed direction. Second-quarter interest expenses rose 9.1 billion won, or 5 percent, to 191 billion won from 181.9 billion won, reversing a 5.8 percent decline in the first quarter as asset growth picked up. Selling and administrative expenses increased 10.9 billion won, or 5.2 percent, to 221.6 billion won from 210.7 billion won, while card costs rose 8.6 billion won, or 3.2 percent, to 274.3 billion won from 265.7 billion won.
Compared with the previous quarter, the improvement in net profit was striking. Net profit for the period surged 86.2 percent to 120.5 billion won in the second quarter from 64.7 billion won in the first.
For the first half of this year, net profit for the period totaled 185.2 billion won, up 19.7 billion won, or 11.9 percent, from 165.5 billion won in the same period last year. Operating profit rose 35 billion won, or 16.3 percent, to 249.5 billion won from 214.5 billion won, while pretax profit climbed 35.9 billion won, or 16.8 percent, to 250.1 billion won from 214.2 billion won.
First-half operating revenue grew 211.6 billion won, or 10 percent, year on year to 2.37 trillion won from 2.13 trillion won. Card revenue led the expansion, rising 59.1 billion won, or 6.9 percent, to 919.9 billion won from 860.8 billion won, while interest income increased 26.3 billion won, or 3.2 percent, to 852.4 billion won from 826.1 billion won. Other operating revenue jumped 126.2 billion won, or 28.8 percent, to 564.8 billion won from 438.6 billion won.
Asset growth underpinned the top-line expansion. Product assets stood at 24.5 trillion won at the end of June, up 1.5 trillion won, or 6.6 percent, from 23 trillion won a year earlier. The figure also rose 600 billion won from 23.9 trillion won at the end of last year, reflecting six months of growth.
First-half operating expenses rose 176.7 billion won, or 9.2 percent, to 2.09 trillion won from 1.91 trillion won — slightly below the 10 percent revenue growth rate, leaving room for further profit improvement.
Among cost items, credit loss provisions stood out. First-half credit loss provisions, including allowances, rose 34.6 billion won, or 11.7 percent, to 330 billion won from 295.4 billion won. With the increase through the first quarter having been just 1.7 percent, the data show the burden was concentrated in the second quarter. Selling and administrative expenses rose 21.7 billion won, or 5 percent, to 451.5 billion won from 429.8 billion won, while card costs increased 26.5 billion won, or 5.1 percent, to 547 billion won from 520.5 billion won.
Funding costs, however, eased. First-half interest expenses fell 2 billion won, or 0.5 percent, to 370.7 billion won from 372.7 billion won. Absolute funding costs declined despite 6.6 percent asset growth, suggesting financing conditions improved from a year earlier.
Profitability metrics also improved. The first-half operating revenue margin rose 1.0 percentage point year on year to 19.5 percent from 18.5 percent, and the operating profit margin edged up 0.2 percentage point to 2.1 percent from 1.9 percent. Return on assets improved 0.1 percentage point to 1.5 percent from 1.4 percent. The operating expense ratio, however, also rose 0.8 percentage point to 17.4 percent from 16.6 percent.
The delinquency rate as of June stood at 0.74 percent, improving 0.05 percentage point from 0.79 percent at the end of last year. The effective delinquency rate fell 0.11 percentage point to 1.05 percent from 1.16 percent over the same period.
won@heraldcorp.com
